The MicroStrategy ETF is scheduled to go live tomorrow with a 1.5x leverage. This is the second of such ETF products launching this month.
MicroStrategy Incorporated, one of the world’s most prominent corporate Bitcoin (BTC) holders, is preparing to introduce a new Exchange Traded Fund (ETF) with a 1.5x leverage. This action indicates the increasing demand for crypto-based products among institutional investors. It also suggests the organization’s commitment to adopting cryptocurrency.
Another volatile From MicroStrategy ETF
Eric Balchunas, a senior Bloomberg ETF Analyst, emphasized the launch, asserting it would rank among the most volatile ETFs in history. This is comparable to the initial MicroStrategy ETF MSTX, launched last week and provides 1.75x leverage over the MSTR stock price.
Simultaneously, he observed that it would be “a touch less than the top dog $MSTX (1.75x long MSTR), which has traded a record $50m today.” The ETF expert recognized the liquidity’s rapid expansion and predicted it would soon surpass $100 million.
This form of ETF by MicroStrategy is associated with its Bitcoin strategy. In 2020, the business intelligence software company adopted BTC and has been dedicated to accumulating the premier cryptocurrency for the past four years. The Bitcoin portfolio of MicroStrategy contained a total of 226,500 units of the coin as of June 30. At present, the holding is valued at approximately $15 billion.
Fortunately for MicroStrategy, the decision to adopt Bitcoin has resulted in a significant increase in its ecosystem. The firm’s shares, MSTR, have outperformed their counterparts, including 499 out of the 500 shares on the S&P 500. In the past year, the MicroStrategy share has experienced a more significant increase in value than Bitcoin, which gave it exposure.
Crypto ETFs Become Wall Street Investors’ Partner
Wall Street investors are expanding their pursuit of digital currency exposure beyond the MicroStrategy ETF to guarantee that they incur minimal losses. The United States Securities and Exchange Commission (SEC) has supported crypto ETFs in the past six months, serving as an alternative.
BlackRock, Greyscale, Franklin Templeton, VanEck, Fidelity, and Bitwise were among the issuers of Spot Bitcoin ETFs introduced in January. Less than five months later, spot Ethereum ETFs followed suit, providing investors in the United States with additional alternatives. Morgan Stanley and other prominent financial institutions possess portions of these crypto exchange-traded funds (ETFs).
Since their introduction, these products have been subject to various market sentiments, including inflows and significant outflows.
